Question

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement that the account in which the account balance is reported, and in Column 4 the account’s nature (temporary/permanent).

(1)
1 2 3 4
Interest payable -_________-__________-_________-__________-
(2)
1 2 3 4
Interest receivable - _________-__________-_________-__________-
(3)
1 2 3 4
Discount on Notes - _________-__________-_________-__________-
Payable
(4)
1 2 3 4
Store equipment -_________-__________-_________-__________-

Answer 1

Interest payable - liability -credit-balance sheet-temporary

Interest receivable - income-debit-balance sheet-temporary

Discount on Notes payable-expenses-debit-balance sheet-temporary

Store equipment -assets-debit-balance sheet- permanent

Hope it helps!